MAFATLAL INDUSTRIES vs NADIAD NAGAR PALIKA

The Supreme Court upheld the Gujarat High Court's ruling that the appellant, a textile manufacturing company, is liable to pay octroi duty under Section 99 of the Gujarat Municipal Act, 1963. The Court clarified that the cutting of cloth pieces into smaller sizes constitutes 'consumption' as defined under the Act, thereby attracting octroi duty. The judgment referenced the definition of 'octroi' in Clause (16) of Section 2 and the applicability of entry 52 of List - II of the 7th Schedule of the Constitution, affirming that mere physical entry of goods does not suffice for duty imposition.